Business Essentials

Question 1

Command Economies

Answer 1

Communism and socialism

Question 2

Communism

Answer 2

Government owned and operates

Question 3

Socialism

Answer 3

Government owns critical industries, individuals own non-critical

Question 4

Market economies

Answer 4

Economic basis is supply and demand, political basis is capitalism

Question 5

Capitalism

Answer 5

Encourages private ownership of the factors of production

Operates under the concept of supply and demand

Question 6

Mixed market economies

Answer 6

Combination of command and market economies

Question 7

Degrees of competition

Answer 7

Perfect, monopolistic, oligopoly, monopoly

Question 8

Perfect competition

Answer 8

Many sellers, product is basically identical

Question 9

Monopolistic competition

Answer 9

Few to many sellers, product is unique to some buyers

Question 10

Oligopoly competition

Answer 10

Few large supplied, products are similar

Question 11

Monopoly competition

Answer 11

One producer, unique product

Question 12

Organizational boundaries

Answer 12

Separate the organization from its environment

Question 13

Aggregate output

Answer 13

Measure of economic growth

Total quantity of goods/services produced by an economic system during a given period

Question 14

Productivity

Answer 14

Measure of growth that compares the output of an economic system with the resources that are needed to produce the output

Question 15

Measuring economic growth

Answer 15

GNP and GDP

Question 16

GNP

Answer 16

Value of all goods and services produced by a national economy within a given period regardless of production location

Question 17

GDP

Answer 17

Value of all goods and services produced by a national economy within a given period with domestic factors of production

Question 18

Balance of trade

Answer 18

Exports - imports

Question 19

Economic stability

Answer 19

Amount of money available and quantity of goods and services produced are growing at the same rate

Question 20

Threats to economic stability

Answer 20

Inflation, deflation, unemployment

Question 21

Types of unemployment

Answer 21

Frictional, seasonal, cyclical, structural

Question 22

Political-legal environment

Answer 22

Reflects the relationship between business and government

Question 23

Socio-cultural environment

Answer 23

Customs, values, attitudes and demographic characteristics of the society in which an organization functions

Question 24

Porters 5 forces model is used to…

Answer 24

Analyze the competitive situation in an industry

Question 25

Outsourcing

Answer 25

Paying suppliers and distributors to perform certain business processes

Question 26

Divestitures and spinoffs

Answer 26

Selling part of an existing business or setting it up as a new corporation

Question 27

Acquisitions and mergers

Answer 27

Horizontal, vertical or conglomerate mergers

Question 28

Strategic alliances

Answer 28

Two or more companies temporarily join forces, often called a joint venture

Question 29

Ethics

Answer 29

Standards or moral values that dictate what is right and wrong

Question 30

Influences on ethical behaviour

Answer 30

Family, peer group, experiences

Question 31

Organizational objective change…

Answer 31

Infrequently

Question 32

Core principle organization values change…

Answer 32

Never (unchanging)

Question 33

Strategies and practices change…

Answer 33

Frequently

Question 34

Corporate social responsibility

Answer 34

The idea that a business should balance its commitments to individuals and groups that are directly affected by its activities

Question 35

Fair-trade movement

Answer 35

Designed to help workers in developing countries receive fair pay for their work

Question 36

Responsibility towards consumers

Answer 36

Rights of consumers, collusion, ethics in advertising

Question 37

Cheque kiting

Answer 37

Writing cheques against money that has not yet arrived in the bank account

Question 38

Insider trading

Answer 38

Using non-public information to gain from the sale of stock

Question 39

Triple bottom line reporting

Answer 39

Financial reports, social audits, sustainability reports